Ex-MetroHealth COO sentenced to 15 years for defrauding hospital


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The former chief operating officer of Cleveland-based MetroHealth System was sentenced to more than 15 years in prison for his role in a conspiracy to defraud the health system through a series of bribes and kickbacks, according to the Department of Justice.

Five things to know:

1. The sentencing came after former COO Edward Hills, DDS, and three co-defendants — all dentists at MetroHealth — were found guilty of criminal charges in July 2018. The four men were indicted for the crimes in October 2016.

2. According to court documents presented by the Justice Department during the trial, Dr. Hills and two of his co-defendants engaged in a racketeering conspiracy from 2008 through 2016 that involved a series of bribes, witness tampering and other crimes.

3. Federal prosecutors alleged Dr. Hills solicited cash, checks and expensive gifts from the two co-defendants beginning in 2009, and in return took actions on their behalf allowing them to operate their individual private dental clinics during regular business hours while receiving full-time salaries from MetroHealth.

4. Dr. Hills, who also served as interim president and CEO of MetroHealth from December 2012 through July 2013, allowed the co-defendants to hire MetroHealth dental residents to work at their private clinics during regular business hours and did not require them to pay wages or salaries to residents. He allowed the three individuals and others to solicit bribes from prospective dental school residents, which amounted to at least $75,000 between 2008 and 2014.

5. Dr. Hills’ co-defendants are scheduled to be sentenced later this month.





Collectively, the executives, business owners and medical professionals involved in the conspiracy are accused of causing more than $1 billion in losses for Medicare.


Two dozen people were indicted in the multistate, international telemarketing and DME scheme, which allegedly occurred in 17 federal judicial districts.

The 130 DME companies submitted more than $1.7 billion in claims to Medicare, were paid more than $900 million, and accounted in total for more than $1 billion in losses for the federal government.

The swindled money was allegedly laundered through international shell corporations and used to purchase exotic automobiles, yachts and luxury real estate in the United States and abroad,

Federal prosecutors are calling it one of the largest healthcare fraud schemes they’ve ever investigated.

Criminal indictments were made public this week against 24 people, including CEOs, COOs, physicians, and other executives at five telemedicine companies, and the owners of 130 durable medical equipment companies across 17 federal judicial districts for their roles in various schemes to bilk Medicare out of $1.2 billion.

Prosecutors said the DME companies allegedly paid kickbacks and bribes in exchange for the referral of Medicare beneficiaries by physicians in cahoots with fraudulent telemedicine companies for unnecessary back, shoulder, wrist and knee braces.

Some of the defendants allegedly controlled an international telemarketing network that lured over hundreds of thousands of elderly and/or disabled patients into a criminal scheme that crossed borders, involving call centers in the Philippines and throughout Latin America, prosecutors said.

The defendants allegedly paid doctors to prescribe DME either without any patient interaction or with only a brief telephonic conversation with patients they had never met or seen.

“The breadth of this nationwide conspiracy should be frightening to all who rely on some form of healthcare,” said Don Fort, Chief of Criminal Investigations at the Internal Revenue Service, one of six federal agencies involved in the probe.

“The conspiracy described in this indictment was not perpetrated by one individual.  Rather, it details broad corruption, massive amounts of greed, and systemic flaws in our healthcare system that were exploited by the defendants,” Fort said.

The 130 DME companies submitted more than $1.7 billion in claims to Medicare and were paid more than $900 million, and accounted in total for more than $1 billion in losses for the federal government.

The swindled money was allegedly laundered through international shell corporations and used to purchase exotic automobiles, yachts and luxury real estate in the United States and abroad, prosecutors said.

Court documents allege that some of the defendants lured patients for the scheme by using an international call center that advertised to Medicare beneficiaries and “up-sold” the beneficiaries to get them to accept numerous “free or low-cost” DME braces, regardless of medical necessity.

The international call center allegedly paid illegal kickbacks and bribes to telemedicine companies to obtain DME orders for these Medicare beneficiaries. The telemedicine companies then allegedly paid physicians to write medically unnecessary DME orders. Finally, the international call center sold the DME orders that it obtained from the telemedicine companies to DME companies, which fraudulently billed Medicare.


  • In New Jersey, Neal Williamsky 59, of Marlboro, and Nadia Levit, 39, of Englishtown, New Jersey, owners of 25 DME companies, were indicted for their alleged participation in a $150 million scheme.

    Albert Davydov, 26, of Rego Park, New York, was charged for his alleged participation in a $35 million DME scheme.

    Creaghan Harry, 51, of Highland Beach, Florida; Lester Stockett, 51, of Deefield Beach, Florida; and Elliot Loewenstern, 56, of Boca Raton, Florida; the owner, CEO and VP of marketing, respectively, of call centers and telemedicine companies were charged for their alleged participation in a $454 million kickback and money laundering scheme.

    Joseph DeCoroso, MD, 62, of Toms River, New Jersey, was charged in a $13 million conspiracy to commit healthcare fraud and separate charges of healthcare fraud for writing medically unnecessary orders for DME, often without speaking to patients, while working for two telemedicine companies.

  • In Florida, Willie McNeal, 42, of Spring Hill, the owner and CEO of two telemedicine companies, was charged for his alleged participation in a $250 million scheme to swap kickbacks and bribes for DME referrals.
  • In Dallas, Texas, Leah Hagen, 48, and Michael Hagen, 51, of Dalworthington Gardens, owners and operators of two DME companies, were charged for their alleged participation in a $17 million kickback scheme that generated unnecessary DME orders.
  • In El Paso, Texas, Christopher O’Hara, 54, of Kingsbury, the owner of a telemedicine company, was charged in an $40 million scheme to swap kickbacks and bribes for referrals to DME providers.
  • In Philadelphia, Randy Swackhammer, MD, 60, of Goldsboro, North Carolina, was charged for an alleged $5 million conspiracy to commit healthcare fraud. Swackhammer allegedly wrote medically unnecessary orders for DME while working for a telemedicine company, often with only brief conversations with patients.
  • In California, Darin Flashberg, 41, and Najib Jabbour, 47, both of Glendora, and owners of seven DME companies, were charged with alleged participation in a $34 million scheme that paid kickbacks and bribes in exchange for unnecessary DME orders.
  • In South Carolina, Andrew Chmiel, 43, of Mt. Pleasant, owner of over a dozen companies involved in the scheme, was charged in a $200 million scheme to pay kickbacks and bribes in exchange for unnecessary DME orders.





DOJ charges ex-Tenet Healthcare exec with role in $400M fraud scheme



Six months after Tenet Healthcare reached an agreement to pay $514 million in penalties for an alleged kickback scheme, one of its former executives has been indicted for his part in the plan to pay bribes for patient referrals.

The Department of Justice announced Wednesday that it has indicted John Holland, 60, of Dallas in his role in a $400 million scheme to defraud the government, Georgia and South Carolina Medicaid Programs, and prospective patients of Tenet hospitals.

Holland, the former senior vice president of operations for Tenet Healthcare Corporation’s Southern States Region and the former chief executive officer of North Fulton Medical Center Inc. in Roswell, Georgia, was charged with mail fraud, healthcare fraud and major fraud against the United States.

The indictment alleges Holland was involved in a scheme to pay bribes for patient referrals. which helped Tenet bill the Georgia and South Carolina Medicaid Programs more than $400 million and obtain more than $149 million in Medicaid and Medicare payments based on those patient referrals.

The scheme began in 2000, according to the indictment,  when Holland circumvented internal accounting controls and falsified Tenet’s books, records and reports to conceal payments of bribes and kickbacks in return for the referral of patients to North Fulton Medical Center Inc. and other Tenet hospitals, including Atlanta Medical Center Inc., Spalding Regional Medical Center Inc. and Hilton Head Hospital.

Holland pled not guilty to the charges during a court hearing, Reuters reported. His lawyer, Richard Deane, said Tenet’s agreement in August to settle criminal charges and civil claims, should have resolved this issue.

“Mr. Holland is not guilty and we now look forward to presenting this case to a jury,” Deane said in a statement to Reuters.

But Acting Assistant Attorney General Blanco said in a statement from the DOJ that “these charges underscore our continued commitment to holding both individuals and corporations accountable for their fraudulent conduct.“We will follow the evidence where it takes us, including to the corporate executive ranks.”

Feds Allege Mass Forest Park Medical Center Kickback Scheme; 21 Indicted

Feds Allege Mass Forest Park Medical Center Kickback Scheme; 21 Indicted

(Credit: Justin Clemons)

A federal grand jury has returned indictments on 21 individuals allegedly involved in a massive kickback scheme through the defunct Forest Park Medical Center chain of luxury hospitals, which resulted in “well over half a billion dollars” in billed claims due to illegal bribes.

The 44-page indictment, unsealed Thursday, describes a vast, four-year conspiracy, fueled by $40 million in kickbacks funneled through a number of shell companies—consulting firms, commercial real estate firms, business services organizations—into the pockets of high-powered surgeons, some of whom have their faces on billboards throughout Dallas-Fort Worth.

The 21 suspects include two of the four physician founders of the hospital chain, including Dr. Richard Toussaint, the anesthesiologist who is awaiting sentencing on a separate fraud conviction; and Wade Barker, the bariatric surgeon who helped develop the idea for Forest Park. Other early adopters indicted in the scheme include Wilton ‘Mac’ Burt, a consultant who helped run the chain’s affiliated management company until he and his colleague, Alan Beauchamp, were bought out in 2015. Beauchamp was also indicted.

But the bribery scheme sailed far outside the doors of Forest Park’s grey and blue flagship at the corner of U.S. 75 and Interstate 635. Also indicted were prominent bariatric surgeons Drs. David Kim and William Nicholson as well as the minimally invasive spine surgeons Drs. Michael Rimlawi, Douglas Won, and Shawn Henry. Won, the DOJ alleges, was paid $7 million for his referrals. Rimlawi is accused of accepting $3.8 million. The feds argue that Kim and Nicholson, both of whom were investors in Forest Park, were paid $4.595 million and $3.8 million respectively. Reads the indictment: “The surgeons spent the vast majority of the bribe payments marketing their personal medical practices—which benefitted them financially—or on personal expenses such as cars, diamonds, and payments to family members.”

In all, the feds say Forest Park collected “in excess of two hundred million dollars in tainted and unlawful claims.” None of those named in the indictment have returned requests for comment. Sheryl Zapata, the chief development officer for the Texas Back Institute where Nicholson currently practices, said “TBI is not a part of this and we will not be commenting.”

“Medical providers who enrich themselves through bribes and kickbacks are not only perverting our critical health care system, but they are committing a serious crime,” read a statement from U.S. Attorney John Parker. “Massive, multi-faceted schemes such as this one, built on illegal financial relationships, drive up the cost of healthcare for everyone and must be stopped.”

Forest Park Medical Center was a chain of luxury hospitals that sprouted in Dallas, Fort Worth, Southlake, Frisco, and San Antonio. One in Austin was built but never opened, kneecapped due to nearly two dozen construction liens.

The model collapsed in on itself due to its reliance on high out-of-network charges that it would bill to insurance companies. The payers eventually balked, and the patient volumes dried up. The hospitals died one by one, each eventually entering bankruptcy and sold off to a health system. Because they were physician owned, they were barred by the Affordable Care Act from billing any public health insurance plan, such as Medicare, for fear of conflicts of interest regarding referrals. And despite this, it twice had to settle claims with the DOJ for paying kickbacks for Tricare patients and Department of Labor employees. The indictment alleges that this is exactly what happened: Beauchamp, Barker, and Kim, among others, “also attempted to refer patients with lower-reimbursing insurance coverage, namely Medicare and Medicaid beneficiaries, to other facilities in exchange for cash.”

Kickbacks, Bribes, and the Horrifying Truth Behind California’s Largest Medical Fraud Scandal


L to R: Michael Drobot, Tom Calderon, and Ron Calderon

Long Beach hospital owner Michael Drobot spent decades bilking the state of millions for unnecessary surgeries with allegedly bogus hardware, and plenty of doctors went along with him – See more at: http://www.lamag.com/longform/kickbacks-bribes-and-the-horrifying-truth-behind-californias-largest-medical-fraud-scandal/#sthash.flf2d3Ck.dpuf